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Sage reports Financial Results for the Half Year ended 31 March 2011

Financial highlights

  • Underlying pre-tax profit increased by 4%* to £183.5m (H1 2010: £176.1m*)
  • EBITA† margin maintained at 25.6% (H1 2010: 25.2%*, year ended 30 September 2010: 25.5%*), whilst investment in growth initiatives continues
  • Underlying earnings per share increased by 4%* to 9.87p (H1 2010: 9.52p*)
  • Interim dividend increased 4% to 2.68p per share (H1 2010: 2.58p per share)
  • Strong operating cash flow of £233.6m (H1 2010: £236.6m), representing 123% of EBITA†, with net debt reducing to £106.0m at 31 March 2011 (30 September 2010: £219.8m)

Guy Berruyer, CEO, commented: “We delivered good revenue growth and strong cash flows in the first half. I am pleased that our North American business has returned to growth in the period.

As our Sage Business Index, launched in February 2011, has shown, we have seen an increase in business confidence for SMEs in the period, although the picture varies by geography and the outlook remains uncertain. We have continued to invest in the business in the period, including in services offered over the web. Customers have responded well to innovation in our products and services and the provision of strong customer support.

With growth returning to the business, a large and loyal international customer base, and a strong balance sheet, I am confident that Sage is well positioned to capitalise on its many growth opportunities, and look forward to continued progress in the second half of the year.”

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Enquiries

The Sage Group plc +44 (0) 191 294 3068

Guy Berruyer, Chief Executive
Paul Harrison, Group Finance Director
Andrew Griffith, Investor Relations

Tulchan Communications +44 (0) 20 7353 4200

David Shriver
Lucy Legh

An analyst presentation will be held at 8.45am today at Deutsche Bank, Winchester House, 1 Great Winchester Street, London EC2N 2DB. A live webcast of the presentation will be hosted on www.investors.sage.com, dial-in number +44 (0)20 3140 0668, pin code: 108067#. A replay of the call will also be available for two weeks after the event: Tel: +44 (0)20 3140 0698, pin code: 376990#.

* Underlying figures neutralise the impact of foreign exchange movements and exclude amortisation of acquired intangible assets. Foreign currency results for the prior half-year ended 31 March 2010 have been retranslated based on the average exchange rates for the period ended 31 March 2011 of $1.59/£1 and €1.16/£1 to facilitate the comparison of results.

# Organic figures exclude the contributions of current and prior period acquisitions, disposals and non-core products.

† EBITA is defined as earnings before interest, tax and amortisation of acquired intangible assets and is after neutralising the impact of foreign exchange movements.